International Journal of Advanced Engineering Research and Science (IJAERS) Vol-3, Issue-2 , Feb- 2016]

ISSN: 2349-6495

Employee Turnover – A Study of its Cause and

Effect with Special reference to Automobile Sector
Prof. Swati Bankar1, Prof. Dr. M. D. Kakade2, Mr. Akash More3
1
MAEER’s MIT College of Engineering (CMSR) Pune, India
2
BharatiVidyapeeth University (IMED) Pune, India
3
MAEER’s MIT College of Management, Pune, India

Abstract— Productivity is the most important factor for any In an automobile industry also it’s very difficult to manage
industry or the organization. There are number of factors turnover and employees performance. An automobile
on which the productivity of the organization depends upon. industry has some different issues than that of other
And employee turnover is considered to be one of the industrial fields like IT industries, chemical industries or
challenging issues in the today competitive business pharmaceutical industries [Link] an automobile industry it
nowadays. The employee turnover has received requires some physical work, healthy work force and skilled
considerable attention by the organizations this days as it is employees. In addition to this now a day’s automation is
very closely related to the growth and development of any used in automobile industry in larger manner, so technically
organizations Employees turnover is an important issue for aware workforce is a key requirement.
not only the automobile industry but also the service and IT “Employees turnover can be defined as an entry of new
[Link] has proven to be one of the most costly and employee in an organization and exit of existing employee
seemingly inflexible human resource challenges confronting from an organization”.Employee’s turnover from an
by several organizations globally organization could be due to the various reasons. But
All important factors such as Productivity, overall turnover affects very severelyon the productivity, cost
efficiency, quality etc gets affected by an issue of employee increases, capacity decreases and overallefficiency
turnover. Therefore impact of turnover has received decreases etc. That is turnover affects very negatively on
considerable attentionby senior management, professionals different factors in an organization. Also there is loss of
and industrial psychologists. This research paper focus on trained employees due to the turnover.
the different factors that are responsible for the labor The rate of turnover varies from company to company in an
turnover in an automobile industry. It also focus on the automobile sector. And it varies region to region also. The
different major to be consider in order to reduce these highest rate is found where unemployment rate is very
problem from all the different sector of the industry. lower and it is easy to people to get alternative job.
Keywords— employee turnover, automobile sector, Theemployee’s turnover affects positively when one of the
factors. poor performerleaves the job and more skilled person takes
his place. Most organization always required fresh blood or
I. INTRODUCTION fresh workforce. If there is anemployee’s turnover there is a
The globalized world of today is very competitive, and much more possibility of entry of a fresh blood to the
managing employee’s performance is a quite difficult task organization.
for any organizationthe employees are not interested In today’s world technology is changing at a very fast rate
inperform the same task every day for years. Employees and the new generation can cope up with a changing
always seek for new challenging work and a good technology in a better way than that of senior or middle age
environment at a workplace. workforce. Therefore there is an always requirement of new
Generally organizations go through the structured, generation or youth at an organization. If turnover is there at
strategically well planned work process. Therefore process an organization there is a chance to entry new generation at
becomes quit rigid, constant and it will be continuousfor an organization. The employee’s turnover can be affect
years. But employees get bored for similar type of work positively to the organization in a small manner but large
each and every day. rate of turnover is really a dangerous situation for an
organization.

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International Journal of Advanced Engineering Research and Science (IJAERS) Vol-3, Issue-2 , Feb- 2016]
ISSN: 2349-6495
benefits can be given to an employee’s like an
II. FACTORS AFFECTING EMPLOYEES accommodation, transportation facilities etc.
TURNOVER 3.5 Management: -Lack of good management at an
2.1 Organizational factors: - employees are always organization affects organization very negatively;all the
interested to work in such a organization which is well important decisions are taken by management at the
settled, well known and well organized etc. Because in such organization. All the decision has a direct impact on
organizations employees could get the conformance of employees. Actually all the procedures, rules, methods etc.
continuous career growth, good work environment etc. The are decided by management and rest of people have to
rate of turnover decreases if such organizational factors are follow it. Therefore there is a possibility of taking these
provided by the organization for employees. decided procedures in a negative manner by a work force
2.2 Job related factors:-employees are always interested and this may lead to employees turnover. Therefore
for better chances of advancement like good salary, management performs a very crucial role from the
payments, other benefits ensuring smooth career growth. employees turnover point of view. So the wrong decision
Such a job related factors matters a lot for employee’s making can lead to the higher rate of employee’s turnover.
turnover. Absenteeism in the basic factor increases rate of 3.6 Manager: -Employees always wish that the manager
turnover. Turnover affects more at industries where work is should be trustworthy, supportive, reasonable etc..The
not standardized and procedure does not exist for relation between manager and employee has a strong impact
transmitting knowledge to new members. on performance of employee. ifemployees are not
compatible and comfortable with their bosses or the
III. CAUSES OF EMPLOYEES TURNOVER:- treatment getting them from manger is not fair It makes
3.1 Work dissatisfaction: -Work dissatisfaction is one of employee very dissatisfactory .This is one of the cause
the major aspects of employee turnover. Employees who are affects in a large manner on a turnover rate. If the manager
not satisfied with their current jobs they are more likely to shows interest in well being of employees and is supportive
leave their job. Many factors make employee satisfied about and sensitive to words employees emotionally, employee’s
his job like work environment, interpersonal relationship, job satisfaction increases.
field of interest of employees etc. Job dissatisfaction have a 3.7 Work suitability: -The one of the important factors
large contribution in an employee’s turnover. Even though affecting the job satisfaction is work suitability. If an
employees having small problems with their current jobs employee suits or well fit with his work employee will be
and if there is an availability of alternatives then employees satisfied and the turnover will be lowered. But if the work
prefer to quit their current job. profile doesn’t suits to the employees field of interest,
3.2 Salary & wages:-Salary or payment is nothing but attitude, personality, education background etc. Then it
remuneration or consideration given for the work or makes employee mentally disturbed, dissatisfied, and thus
services provided by employees. Salary and wages have an the performis effected.
important role in retaining and rewarding key importance 3.8 Personality: -Different Aspects of personality like
employees. By binding pay with performanance an attitude, characteristics, preferences, motives, needs leads to
employer can monitor and control specific activities and tendency to respond to the situation in a specific way.
level of performanance. Payment and wages given to Therefore personality has a great impact on a turnover rate.
employees strongly related with job satisfaction. For an example, an emotionally mal adjusted employee is
3.3 Praise, Promotions, Awards &Rewards:-All business more likely to be dissatisfied in all situations.
use tact of promotion, bonuses or other type of rewards to 3.9Alternative opportunities:-Perceived alternative
encourage high level of performance. It is studied that lack employment opportunity also known as perceived ease of
of bonuses, rewards promotion increases dissatisfaction movement. It is the perception of the availability of job
among the employees and denotive themabout the job or a alternatives; this perception factor is an uncontrollable
work. Further this can lead to employees’ turnover. factor for an employee which distracts employee from work
3.4 Other benefits: -Other benefits like fringe benefits are and reason of job turnover many times.
a kind of rewards given to an employees or a group in an 3.10 Educational background:-It is studied that a work
organization such benefitsmotivates employees to work force with a higher qualification has a belief that they have
very efficiently and with full dedication. Many type of a more job opportunities than that of a quite lower qualified
people. They think the higher qualification is extra

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International Journal of Advanced Engineering Research and Science (IJAERS) Vol-3, Issue-2 , Feb- 2016]
ISSN: 2349-6495
advantage they got. This factor distracts them from their Organizational culture, organizational values, ethics
current job, further it may be reason for job turnover. followed at organization, organizational structure, affects
greatly on the mindset of employees. Therefore providing
IV. REMEDIES TO TURNOVER these factors properly in organization is very important.
Retaining employees is a very important task; employees 4. Economic factor:-Salary, wages, economical benefits
are nothing but precious asset and the important part of given to the employees is the most important and
organization. The best organization always tries to retain, motivating factor to the employee. For an example Fords
sustain the organizational asset. Human resource is such an car plant was experiencing significant employee turnover
asset without which organization can’t work, therefore often reaching at levels of 300% to 400% per year after
management of the organization always has to take care of study decision was taken to double basic wages from $2.5
their workforce. to $5 per day and the turnover was drastically minimized.
Globally there are some common reasons of turnover like 5. Training and development:-One of the essential
payments, job satisfaction, interpersonal relationship, job fit requirements at an organization, where the basic training
etc..Finding solution for these factors is very important task, about the work profile is given by the experts and the
to minimize the effect of turnover on an organization. important information, knowledge easily communicated.
1. Recruit suitable employee:-To minimize the effect of Training and development motivates, inspires employees.
turnover firstly the organization has to select right person The work of employees is properly utilized in a required
for the right work. That is job fit or work suitability is very manner due to training and development process. Due to
important aspect for the efficient performance of the Training and development, employees can give more
employee. superior work performance.
The employee’s field of interest has to be taken in 6. Fulfilling Needs and wants:-Fulfilling needs and wants of
consideration while recruiting an employee, because it is employees is quite important and difficult task for an
observed that employees are more likely to work in their organization. If individual’s needs and wants not satisfied
field of interest. Any human being can work enthusiastically then it make him dissatisfactory which may lead to job
and satisfactorily in his field of interest. turnover. Therefore organization has to fulfill needs and
Personality, attitude, thoughts etc.. Makes every human some wants of employees to retain staff.
being different than that of others therefore while recruiting 7. Job satisfaction:-Job satisfaction is very important factor
employee’s organization has to take in consideration these for retaining staff. Many times employee can adjust with
aspects of individual employee. other factors like fringe benefits, bonuses etc.. But it’s very
2. Retain valuable employees: -The reputed organizations difficult to work in an organization with dissatisfaction for a
always attract and hire employees who will make long time for employees. With job dissatisfaction employee
meaningful contribution towards organizational goals. can’t give his best performance. Job dissatisfaction leads to
Companies striving to hire best employees have a decreased efficiency, decreased productivity, and higher
competitive edge over others. Organizations have to be turnover [Link] job satisfaction is important for
scrutinize employees very thoughtfully considering all the that giving some responsibilities and authorities to an
important aspects. Employees are the very valuable employees is required.
ingredient of organization, therefore keeping employees Motivating and supporting to employees is needed, taking
busy isimportant. into consideration about employee’s field of interest and
For retaining, sustaining employees motivating employees personality is [Link] of participating in decision
is very important. Motivation can be done by experts; making procedure to an employee in his related respective
employees can be motivated by providing bonuses, fringe field should be provided. In this way employees can be
benefits, awards, rewards etc. The other ways to motivate is satisfied about organization.
giving responsibilities, taking suggestions for the changes, 8. Proper management and managers:-It is very important
promotion etc. Participating in decision making process is that the management of the organization should be
also motivating for employees. supportive one towards employees stressful job. Therefore
3. Work environment:-Work process matters lot from the the lack of support decreases the workers ability.
employees point of view. Creating such Workplace 9. Balancing job and private life:-Organization should find
Environment whereemployees love to work ways to help employees successfully manage their
commitment at a home and at a work place and by doing so

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International Journal of Advanced Engineering Research and Science (IJAERS) Vol-3, Issue-2 , Feb- 2016]
ISSN: 2349-6495
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